OOOOhhh that makes me mad...(aug rant)

"Loss Mitigation Specialist" is what this guy's title was. He worked at the bank we were working with to get a short-sale approval before a property went to foreclosure. I'm not sure who designated him a "Specialist", but it was clear from the outset that he was just reading off a script, didn't actually specialize in anything. Our experience with him and his bank just re-affirmed for us our concern that there isn't a whole lot of committment to helping people who are in default and trying to work through the process diligently and honestly.


Granted, this was a tough situation-there was a tenant in the property who was making it difficult to show the property and get our inspectors on-site, plus rent was in arrears, and we had to go back to the bank to get an extension before they sent the property to auction. The "Specialist" we were supposed to be working with was almost impossible to reach, and when we did talk to him all we got was scripted answers with no regard for the fact that this was a situation nobody could have planned for. We got closer and closer to the deadline and the auction loomed.



We tried for weeks to get an extension. I can't tell you how many messages we left (you'll remember from previous posts-as an investor, I almost always get my call returned from banks who are serious about business deals). Finally, at 5:30pm on the Friday before the scheduled Monday auction, we got a-hold of somebody and got the extension. We had done all the right work on our end, including arranging to get the tenant off the property, and yet this house very nearly went into foreclosure when it didn't need to. And the price we had already negotiated with bank was significantly higher than they could reasonably expect to get at an auction.



The whole thing made no sense, in terms of the banks ability to recoup as much money as possible, in terms of the effort the seller was going through to make things work out, and our own up-front negotiation. But all this "Specialist" saw was that an auction had been set and that was it, period.



So...



Was this "Loss Mitigation Specialist" just a green recruit?

Was he following orders?

Was the bank overwhelmed and understaffed?



Frankly...I don't care. I've had a lot of really good experiences with banks, but frankly I've ALSO had a lot of experiences like this one. The banks have gotten a lot of support from us as taxpayers, and they need to step up their staffing and training. I wish I could say it was just this one guy, but there are a lot of jerks filling "Loss Mitigation Specialist" roles, and they are costing their employers clients, reputations, and worst of all (in banking terms), cash.



C'mon banks, get your people trained and empowered!

To my readers-Stay rebellious, demand better treatment!
LARRY

Sellers Tip for August-Find a short-sale expert early

I would never tell anybody to miss a payment, go into default, or willingly stare foreclosure in the face. What I will tell you is this:

If it's happening to you, get real about it. And get real, REAL fast. This will be one of the hardest times of your life. Having somebody to shepherd you through it can help ease your stress levels and help keep your credit score as healthy as possible. You also need to understand all your options before you have them taken away from you.


And while I'm good at what I do, I know I don't have all the answers (there's that dang honest streak again), but I bet among our readers we've seen just about every situation possible. So, post your dilemma's and questions, and I bet somebody from our Rebellious Readership will have some advice.

Buyers Tip for Aug-if you want to DO the RE Boogie, prepare to Get (some) Down (payment, that is...)

My Buyers Tip For This Month: Down Payments are back, so prepared!

And I hate to admit it (well, actually, I'm perfectly happy to admit it), but I'm glad.

If you're an investor, you should actually have some risk in your investment. That's what keeps old Mr. Smith's Invisible Hand working in the market place. As investors, we should take risks that are commensurate with returns. Without that, prices rise with no basis, people jump in and out of the market for no good reason but quick returns, bubbles get created, economies crash, and suddenly schools in Scandinavia are struggling because of mortgage defaults in small towns in the US. As Bill Murray says in Ghostbusters, "DOGS AND CATS, LIVING TOGETHER!!! MASS HYSTERIA!! " Unbelievable.



And you're looking for a home for your family versus a flip or a rental property, I think it's good news too. When down payments are required, you only buy the amount of house you can actually afford over time. And, there's less of a tendency to treat your house as a giant ATM machine. So people tend to keep expectations rational and prices tend to stay more realistic (I don't think a 2-bedroom condo would have hit $600K in most Bay Area cities if people had to have $120,000 in cash to get one...)



So get ready for it, Buyers, because having a decent credit score and unlimited optimism about the market is a thing of the past (for now). Investors should be thinking about 25%-35% down, and a retail buyer should be thinking around 20%. Believe me, we'll all be better off for it!

Rebelliously,

Larry

A GREAT show on the state of Bay Area Real Estate

http://www.kqed.org/epArchive/R908070900

And as I've been saying...NOBODY has a crystal ball...